December 09, 2004

Spitzer Probe Good+Bad for Insurers?

Increased disclosure and transparency will result from the Spitzer investigation of the insurance industry, and that will be good for it in the long run, suggests Therese Rutkowski, Managing Editor of Insurance Networking News, in "Spitzer Probe Pushes For More Disclosure" Insurance Networking News, December 1, 2004.

The Spitzer probe, according to Rutkowski, "is pushing the entire industry-even those who have nothing to hide-toward process and technology improvements that enable companies to track and manage compensation more effectively-as well as to disclose those processes and data to regulators when required." The availability of that information will ultimately enable insurers to provide better products at lower prices, she suggests.

She also points to the treasure trove of indiscrete statements that Spitzer's staff seems to have found in the e-mail archives produced by subpoenaed insurers and brokers. Similar gems found in the investigation of investment bankers and the antitrust actions against Microsoft.

The article quotes Robert H. "Skip" Myers Jr., partner in the Washington, D.C. office of law firm Morris, Manning & Martin LLP: "E-mail creates an electronic trail of information, and if you're Eliot Spitzer, once you get into the database and you've got the time to look at it, you can follow the clues and get all the information," Myers told Rutkowski. "As we've seen in any number of recent investigations, e-mail can be a terribly obvious form of information, which-for whatever reason-people don't seem to manage with the same scrutiny as they do their written communications."

All this is enough to make a company consider updating their policy regarding management of email. See, e.g. Atty. Chip Rainey's "Trying to Exorcise the Ghosts, Nightmares and Demons Alive in your E-mail Server: The Need for A Virtual Document Retention Policy," (PDF) a presentation to a local chapter of American Corporate Counsel Association (ACCA). Mr. Rainey is a partner in Locke Liddell & Sapp LLP.

Posted by dougsimpson at December 9, 2004 02:30 PM | TrackBack